Cable is in a very powerful recovery mode from the 1.3502 lows that were hit in January of 2009. Prices have already traded up to the 50% retracement area of the wave 3)/C distance where a temporary top could be placed for some time, if we consider a possible high of a red wave C/III. With this being said, traders should be patient as the market may react with a powerful turning point, if we consider that a top of wave 4) could also be the case. If that happens then wave 5) should follow lower.On the other hand, the market may also be trading at the start of a new uptrend that will lead into new highs, but in this case the A), B), C) (zig-zag with an extended wave C) ) will be the correct count from the 2.1161 high to 1.3502 low. A break of the 1.9336 area will confirm that scenario.
Daily chart trend: Short possibilities. Main price points: 1.5982 and 1.7041 Looking for: Move lower
The cable price looks to be toped at the 1.7041 area with a black wave V) of an extended red wave C/III. Prices fell very sharply from those highs to current level, which suggests a temporary down-trend. We notice that the market also broke through the black line connected from wave B/II and wave II) lows, which is another bearish signal for a possible 1.5982 zone test.
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